Anil Agarwal to turn copper smelter into a giant by doubling capacity

Billionaire Anil Agarwal’s Vedanta Resources Plc plans to double capacity at its Tuticorin plant in India in the next two years, which will make it the world’s second-biggest copper smelter.

Vedanta will invest $717 million boosting the smelter’s annual capacity from 400,000 metric tons to 800,000 tons, it said Friday as it reported a 37 percent increase in first-half earnings. At least $141 million of that has already been spent and the extra capacity should be ready in about two years, it said.

The investment comes as the diversified mining company, buoyed by resurgent metals prices, positions itself as a a major supplier to India’s expanding economy. The Asian country currently only produces about one-fifth of the natural resources it needs, and its $2 trillion economy is expected to triple by 2030, said Agarwal, Vedanta’s founder and chairman.

“Vedanta is uniquely positioned to capture the benefits of sustained commodity demand in India for many years to come,” Agarwal said in an earnings statement.

The company supplies about 30 percent of India’s copper market, and aims to increase that share to 50 percent through the Tuticorin expansion, Chief Executive Officer Kuldip Kaura told reporters on an earnings call.

Copper concentrate for the smelter comes from Vedanta’s mines in Australia and India and is supplemented by supplies bought from third parties, which will need to increase dramatically in order to double metal production. The firm is also investing $1 billion to quadruple output at its Konkola Copper Mines Plc unit in Zambia, but smelts that metal locally.

The Guixi copper smelter run by Jiangxi Copper Co. in China is currently the world’s biggest, producing 900,000 tons of the metal a year, according to the International Copper Study Group.

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